Direct mail response rates took a tremendous leap in 2016 with a 5.3% response rate to house lists and 2.9% to prospect lists. These are the highest levels the DMA has tracked since 2003. For comparison, in 2015 the rates were 3.7% and 1.0% respectively. In 2010 it was 3.4% and 1.4%.

Coordination with other marketing channels- the use of email, social media and purls along with direct mail enhances the likelihood of a positive response

Better mailers- including better design, content, and presentation with increased use of digital variable print

And the bad news…

Postal increase 1/21/18-

The US Postal Service and Postal Regulatory Commission have approved a rate increase effective January 21, 2018. All new rates can be found on the USPS website.

For reference Market Dominant products and prices are required by law to be tied to inflation based on the Consumer Price Index (CPI). These products include 1st Class, USPS Marketing Mail (formerly Standard Mail) and Bound Printed Matter.

Competitive Products do not have this same pricing restriction. These products include Shipping Services such as Priority Mail, Parcel Select and International services.

1st Class - the average price increase is 1.9%

Bound Printed Matter will increase 1-3% overall.

The postage increase for Nonprofit mail is higher- 4.4% to 6.9%.

1st Class forever stamp – currently at $.49 will increase to $.50

In addition the postage discount for Letter SCF entry will decrease- the gap between NDC and SCF discount is narrowed- reduced from 2 cents to 1.6 cents. USPS had been overstating the savings of this work-sharing, and so made this adjustment. This could also increase mail at NDCs which some analysts feel could impact USPS service performance due to increased workload.

Shipping Services such as Priority Mail, Parcel Select prices will increase between 4.9-7%, International about 3.9%. The Postal Service has strategically adjusted pricing higher in areas where competition is not as fierce, and less so where the USPS has more competition.

FedEx is also raising its rates next year by an average of 4.9%, effective January 1, 2018, while UPS will raise rates by an average of 4.9% on December 24, 2017.

Move Update

Another change taking effect on 1/21/18- the tolerance for noncompliance with Move Update was 30%, meaning if 70% of the mail was in compliance, there was no issue. The new tolerance for noncompliance- will be .5%. The noncompliance charge is $.08 per piece- up from $.07. It is now crucial that mail owners and mailers ensure their CASS and Move Update software is up to date and process correctly.

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